Connecticut and the Unaffordable Cost of Healthcare

The following was first published in the Hartford Courant. It is reposted here with the permission of the author.

---

Our state legislature has an opportunity this session to ease one of the biggest burdens facing small businesses today—the unaffordable cost of healthcare.

Connecticut small business owners are closely watching legislation that would make a giant impact on the ability to afford healthcare coverage for their employees.

We all know that healthcare costs are astronomical in our state, but there’s something that lawmakers can do right now to make it easier for many in Connecticut to have affordable, quality health insurance.

Lawmakers are debating HB 6710, which allows nonprofits, trade associations and their employer members two pathways to obtain affordable, high quality health insurance—either as a group that negotiates and purchases directly from an insurer or as a self-funded entity.

Several states have made similar changes to their laws to help small businesses gain access to broad new options for affordable, quality health insurance.

Among these states is Virginia, which later this year, for the first time, will allow small businesses the ability to offer healthcare coverage at competitive prices—a flexibility that small business owners need not only to hire workers but keep them employed.

Bipartisan Support

HB 6710 is backed by over three dozen nonprofit groups, trade associations and business organizations—including the National Federation of Independent Business—and has broad support from both sides of the aisle in the General Assembly.

It’s a viable, market-based solution to an issue that has challenged Main Street for too long.

Rising #healthcare costs are the number one challenge for Connecticut #smallbiz says @InnomarketS co-owner Liliana Serrano. "Lawmakers need to do something to help small business overcome this crisis," she says, "and it is a crisis." #transformCT https://t.co/jYQOnIyOiv pic.twitter.com/KqNVSh7Nau

— CBIA (@CBIANews) May 18, 2023

While businesses with 50 or fewer employees are not required to offer employees health coverage, none can expect to seriously compete for talent without offering that benefit.

Healthcare costs jumped by 6% last year in Connecticut—more than $2 billion.

The lack of affordable options is a major concern for our member firms, with too many of them forced to choose between high-cost plans with limited benefits or not providing any coverage for employees.

Addressing Costs

A recent NFIB survey revealed that most small businesses cannot manage the costs of offering employer-sponsored health insurance, which increased 43% over the last decade, outpacing wages and inflation.

Almost half of surveyed businesses took lower profits or suffered pay losses to cover health insurance premium increases in the last five years.

Sixty-five percent of small businesses say it is too expensive to offer employees health insurance coverage.

Why don’t small businesses offer employees health insurance coverage? Sixty-five percent said it was too expensive.

Seventy-nine percent of surveyed small businesses said they were interested in joining an association health plan. Twelve percent said they would join, 23% would likely join, and 44% would consider joining.

Association health plans would essentially give Connecticut small businesses access to large group insurance contracts and benefits, which generally have better coverage choices at lower premiums.

State, Federal Compliance

Association health plans must comply with state and federal laws, including mandated benefits and preventative screenings.

That means coverage for doctors’ services, inpatient and outpatient hospital care, prescription drug coverage, pregnancy and childbirth, mental health services, dental services for children, breast and ovarian cancer screenings, mental health wellness, telehealth services, urgent crisis center services, and more.

Plans cannot deny someone based on a preexisting condition and people who get sick can neither lose coverage nor be charged higher premiums.

Connecticut lawmakers need to seize the opportunity to enact this transformative legislation that will level the playing field for small businesses.

Small business owners have enough to deal with.

They are still struggling to recover from the COVID-19 pandemic, face rising inflation and supply chain issues, and can’t find qualified workers to hire and stay employed.

Our legislature can ease another of their biggest burdens—the unaffordable cost of healthcare coverage.

Connecticut lawmakers need to seize the opportunity this year to enact this transformative legislation that will level the playing field for our state’s small businesses and their hundreds of thousands of employees.

---

About the author: Andy Markowski is the Connecticut state director for the National Federation of Independent Business.